Wednesday, January 31, 2007

Here are hourly charts of the March S&P futures, the Spiders and the QQQQ's. I last commented on these markets here.

The market has come to life after the Fed announced it would be making no policy changes today. I think all three of these markets have broken above the resistance levels shown on their charts. The breakthrough has occurred on a wide range up bar indicating aggressive buying by longer time frame traders. This is a very bullish sign and means that these markets are headed for the near term upside targets I have indicated on the charts.

I have been bullish on Atria for 6 years now, but I think this story is the proverbial "kiss of death" for MO (Atria's symbol on the New York Stock Exchange). I think we shall see MO make a long term top in the 90-100 range and then begin an extended drop which will carry it at least to 60 and probably much lower than that.

Remember that these are "pre-spinoff" numbers. Altria plans to distribute 0.7 shares of Kraft for every Altria share. So at current market prices this means that about 24 dollars of Atria's price is accounted for by its holdings of Kraft. So "post-spinoff" the zone for the top would be 66-76 and the downside target for MO would be 36 or lower. The record date for the spinoff is March 16 so on Monday, March 19 there will be a big downward adjustment in the market price of MO equivalent to 70% of the price of Kraft at the time.

Altria currently owns about 89% of Kraft Foods. KFT's monthly chart is also above this post. There have been widely circulated stories to the effect that after MO divests itself of KFT the shares of the latter will tank because of the sale. Of course this is nonsense because the market has been anticipating this divestiture for several years now. But in fact I think the situation is emphatically bullish for KFT. After the divestiture I expect to see KFT embark on a long term bull move that will carry it up to 70.

For another comparison of market sentiment towards MO and KFT take a look at the second half of Kevin Delaney's column in today's Wall Street Journal. According to Delaney, 9 of the 13 analysts who follow MO have buy recommendations on the stock, while 17 of the 20 who follow KFT say sell or hold !!!

Spiders - March S&P Futures: I expect the Spiders to rally to 145.00. The futures should move up to 1455.

QQQQ: The Q’s should now rally up to 47-48.

TLT - March Bonds: TLT should find support near 86.50. I expect the market to start a trading range in this vicinity which should be followed a rally to 94-95. The bonds should rally to 110-00 or so and then drop to 108-28. I think a basing process has begun that will be followed by a move above the 115 level.

March 10 Year Notes: The notes have reached their downside target at 106-08. A rally to 106-24 is likely. After that the notes will probably drop to 105-28. I think the market has begun a basing process. After it is complete I expect a move to above the 110 level.

Euro-US Dollar: The euro is likely to rally to 130.00 and then drop to its next support near 126.90.

Dollar-Yen: The yen is headed for 122.50. Support is at 119.80. I expect to see the yen trade at 130 in 2007.

OIH - USO - March Crude: The oil market rallied sharply yesterday, contrary to my near term expectation. I think OIH will hold support at 132 and rally to 140 or so before dropping substantially. USO should hold support at 45 and rally to 49. Crude has nearly reached my 57.50 upside target. A drop to 54.00 from here would be normal but I think the market is likely to rally to 60.00 before resuming its bear market.

GLD - April Gold: GLD is still stalling in the 64.00 - 65.00 zone but the market shows no sign of aggressive selling. I now think it is headed for the 67-69 range before the bear market resumes. Switching to the April contract in gold. I think gold futures will rally to 675 and possibly to 690.

March Silver: I think silver is on its way up to 1395. From there the bear market should resume.

Tuesday, January 30, 2007

Here are hourly charts of the March S&P futures, the Spiders, and the QQQQ's. I last commented on these markets here.

I think the technical condition of these three markets is becoming more and more bullish. The last three hourly bars that I have highlighted are telling an important story.

The first two of these bars, highlighted in red, are wide range down bars and indicate selling by longer time frame traders. As always, sellers are accomodated by buyers so one must guess the motivations and time frames of the buyers to make deductions about the direction of the market's trend. In this case both bars travelled pretty much the same range and this hints that the same sellers were at work both times. But in neither case was there any follow through selling. This tells me that the buyers were also longer time frame traders.This already hints at bullish potential.

The last highlighted bar on the chart is a wide range up bar occurring near the highs of the last two big down bars. This indicates longer time frame buying. It is doubly significant because it shows longer time frame traders raising their bids and doing so right in the area where longer time frame sellers were active the previous two days.

This is very aggressive bullish activity and I think it means that the markets are about to move above the resistance levels indicated on these charts and climb to new highs for this bull market.

Spiders - March S&P Futures: I expect the Spiders to hold support near 141.60 and then to resume their rally to 145.00. The futures should hold support near 1421 and then move up to 1455.

QQQQ: The Q’s should hold support near 43.20 and then resume the move up to 47-48.

TLT - March Bonds: TLT should find support near 86.50. I expect the market to start a trading range in this vicinity which should be followed a rally to 94-95. The bonds should rally to 110-00 or so and then drop to 108-28. I think a basing process has begun that will be followed by a move above the 115 level.

March 10 Year Notes: The notes have reached their downside target at 106-08. A rally to 106-24 is likely. After that the notes will probably drop to 105-28. I think the market has begun a basing process. After it is complete I expect a move to above the 110 level.

Euro-US Dollar: The euro is likely to rally to 130.00 and then drop to its next support near 126.90.

Dollar-Yen: The yen is headed for 122.50. Support is at 119.80. I expect to see the yen trade at 130 in 2007. OIH - USO - March Crude: I think OIH will drop to 128 or so and then rally back to 137. USO still has resistance at 47.00 and from there will drop back to 43.00. I think crude will drop close to 52.00 and then rally to 57.50.

GLD - February Gold: GLD is still stalling in the 64.00 - 65.00 zone. A close below 64.00 would have very bearish implications. I think it is still a good bet that the market will drop from here.

March Silver: A close below support at 1323 would be very bearish. Meantime I believe that silver will rally at least to1365.

Monday, January 29, 2007

Here are hourly charts of the March S&P futures, the Spiders, and the QQQQ's. I last commented on these markets here.

Friday I said that I thought these markets would break above the resistance levels indicated in the charts which are defined by the high of Friday's wide range, down hour at the open. Today the Q's took a brief peek above that level but so far the S&P's and Spiders have not managed to move above that resistance. The market has behaved sluggishly near resistance and this means that it is about to take a trip back to Friday's lows or a tad lower.

However, I don't think Friday's low points will be broken by much if at all, and I think that a move to the upside targets of 1455 in the S&P's, 145.00 in the Spiders, and 47-48 in the Q's will begin in a day or two.

Spiders - March S&P Futures: I expect the Spiders to hold support near 141.60 and then to resume their rally to 145.00. The futures should hold support near 1421 and then move up to 1455.

QQQQ: The Q’s should hold support near 43.20 and then resume the move up to 47-48.

TLT - March Bonds: TLT should find support near 86.50. I expect the market to start a trading range in this vicinity which should be followed a rally to 94-95. The bonds have nearly reached support near 109-04. A rally to 110-00 or so is likely and should be followed by a move to 108-28. I think a basing process has begun that will be followed by a move above the 115 level. March 10 Year Notes: The notes have reached their downside target at 106-08. A rally to 106-24 is likely. After that the notes will probably drop to 105-28. I think the market has begun a basing process. After it is complete I expect a move to above the 110 level.

Euro-US Dollar: The Euro is about to break downward from its recent trading range. Next support is at 126.90.

Dollar-Yen: The yen is now headed for 122.50. Support is at 119.80. I expect to see the yen trade at 130 in 2007.

OIH - USO - March Crude: I think OIH will drop to 128 or so and then rally back to 137. USO still has resistance at 47.00 and from there will drop back to 43.00. I think crude will drop close to 52.00 and then rally to 57.50.

GLD - February Gold: GLD has so far stalled in the 64.00 - 65.00 zone and a close below 64.00 would have very bearish implications. Gold has not closed above 649 so I think it is still a good bet that the market will drop from here.

March Silver: Silver is close to support at 1323. A close below there would be very bearish. Meantime I have to believe that silver will rally at least to1365.

Friday, January 26, 2007

Here are hourly charts of the March S&P futures, the Spiders, and the QQQQ's. I last commented on these markets here.

I had expected yesterday's low points to hold, but this morning all these markets broke those lows decisively on a wide range down bar. In fact the Q's made a new low for the reaction that started from their January 16 top.

I am still willing to bet that this morning's low points pretty much ended the break from yesterday's highs. The support levels I am working with are shown on the charts.

Today's first hour high is also drawn on the chart. As the high of a wide range, down bar this is normally pretty strong resistance for any rally. If I am reading this market correctly then the market will rally above this resistance level on Monday.

A few days ago I commented on the NYSE advancing issues indicator. Dave has pointed out to me that the data shown in the corresponding chart was incorrect. In fact it was so far off for a couple of days that my original comments were well off-base.

I have added an opening paragraph to that post in italics. The chart at the top of the post shows the correct data while the other chart is the one that originally appeared with the post.

Spiders - March S&P Futures: I expect the Spiders to hold support near 142.20 and then to resume their rally to 145.00. The futures should hold support near 1428 and then move up to 1455.

QQQQ: The Q’s should hold support near 43.60 and then resume the move up to 47-48.

TLT - March Bonds: TLT should find support near 86.50. I expect the market to start a trading range in this vicinity which should be followed a rally to 94-95. The bonds have nearly reached support near 109-04. I think the market will soon start moving sideways in preparation for a move above the 115 level. March 10 Year Notes: The notes have reached their downside target at 106-08. I think the market is about to establish a trading range. The next big move from here should be upward above the 110 level.

Euro-US Dollar: The Euro is about to break downward from its recent trading range. Next support is at 126.90.

Dollar-Yen: The yen is now headed for 123.00. Support is at 119.80. I expect to see the yen trade at 130 in 2007. OIH - USO - March Crude: OIH has nearly reached resistance at 137 and should soon head down to 126 again. I think USO stopped 50 cents shy of the 47.00 target but now looks like it will drop back to 43.00 before it tries to rally again. I think crude will drop close to 51.00 and then try to rally once more.

GLD - February Gold: GLD has so far stalled in the 64.00 - 65.00 zone and a close below 64.00 would have very bearish implications. Gold did not close above 649 yesterday so I think it is still a good bet that the market will drop from here.

March Silver: Silver closed well above 1332 yesterday but gold did not perform as well. I think the best thing to do is lean on support near 1323. A close below there would be very bearish. Meantime I have to believe that silver will rally at least to1365 and possibly to 1400.

Thursday, January 25, 2007

Here are hourly charts of the S&P's, the Spiders, and the QQQQ's. I last commented on these markets here.

The market has dropped sharply today and the S&P's and Spiders have dropped below the estimated support I cited in this morning's guesstimate.

Big declines typically don't begin with a sharp drop on the day the high was made. I think this afternoon's wide range down hour (highlighted in red) will prove to be exhaustion and that longer time frame traders have been buying this break. If I am right about this the markets will not trade much below the last hour's low or below the support levels I have illustrated on these charts.

I think the Spiders will soon resume their move up to 145.00 and that the S&P's will rally to 1455. The Q's should rally into the 47-48 range.

Here is a daily chart of the Dow Jones Industrial average. On it I have labeled the turning points of an evolving example of the domed house portion of an instance of George Lindsay's Three Peaks and a Domed House formation. I last commented on this here.

As I said in the last post I believe that the market completed the "five reversals" phase of the domed house by putting in its point 20 low as illustrated on the chart. We are now in the rally phase which will lead to the dome of the domed house, points 21 - 25. This should look a little like the standard "head and shoulders" chart formation. I estimate that the top of the rally at point 23 will occur in late March and the "right shoulder', point 25, in mid-May.

Once the dome of the domed house is complete an extended, muli-month decline should begin. I estimate that it will drop the average a little less than 20 % from its high, carrying it down to 10,700 or so, the level at which the entire three peaks and a domed house formation began.

Spiders - March S&P Futures: The Spiders are headed for 145.00 and support today is at 143.00. The S&P futures are headed for 1455 and support stands at 1435

QQQQ: The Q’s are headed for 47-48..

TLT - March Bonds: TLT is headed down into the 86-87 range. The bonds have resistance at 111-12. Next downside target is 109-04.

March 10 Year Notes: Resistance is at 107-16. Next downside target is 106-08. The notes are headed for the 105-106 range.

Euro-US Dollar: The Euro has resistance at 130.70 and have resumed the decline to under 116.

Dollar-Yen: The yen has reached temporary resistance at 121.70. Support is at 119.50. I expect to see the yen trade at 130 in 2007. OIH - USO - March Crude: OIH has nearly reached resistance at 137 and should soon head down to 126 again. I think USO will rally to 47.00 before the bear market resumes. Crude should rally into the 56.00 to 57.00 range. Much lower prices are likely in the months ahead.

GLD - February Gold: GLD has reached strong resistance in the 64.00 - 65.00 zone and a close above the 65.00 would mean much higher prices lie ahead. Gold has moved relentlessly higher, contrary to my expectation, but this morning has traded about 5 dollars above its last top at 648. If it closes above 649 today I shall conclude that much higher prices lie ahead.March Silver: Silver has moved well above its last top at 1324. A close today above 1332 will convince me it is headed back above 1400.

Wednesday, January 24, 2007

Here is a daily bar chart of Google. I last commented on this stock here.

I had been expecting GOOG to drop into the 465-68 range in line with my expectation of a drop in the averages. But yesterday's turn around and today's follow through changed my mind on both fronts. I now see support at 477 and think that GOOG has resumed its advance to 564.

On January 25 Dave pointed out to me in a comment that the first chart you see above this post shows incorrect data. The chart at the top of this post is the correct one and tells a different story. In fact the market never reached the moderate oversold, light green line. Morover, at the highs on January 25, a clear bearish divergence was visible since the 10 day moving average reached the overbought line but was still visibly below its November high. However, I think this divergence is still only a minor one because the moving average did not first reach moderate oversold levels. I expect a more significant divergence(s) over the next couple of months.

Here is a line chart ( added Jan. 26: the first chart above this post) recording the daily count of the number of issues traded on the New York Stock which advance in price. The 10 day moving average of this number appears as fluctuating red line. I last commented on this indicator here.

About two weeks ago the 10 day moving averaged dropped to the light green horizontal line which indicates a moderately oversold condition. It was remarkable that it didn't drop even lower since that was the first moderately oversold condition in almost 6 months. I thought at the time that this was a show of strength for an uptrend that had started in June 2006.

The moving average is now in a rally phase. I think it will continue up to the red horizontal line but I expect it to stay below the high levels it reached last November. If this happens I think it will be the first significant divergence with bearish implications we have seen since last June. Morover, it would not surprise me to see a second such divergence before the averages put in the top I am expecting during the first half of this year.

In any event I think the uptrend has entered its "rounding over" phase. Even so, I also think the Dow industrials will make it up to 13000 and the S&P 500 to 1500 before the bull market ends.

Spiders - March S&P Futures: The Spiders are headed for 144.40 and support today is at 142.40. The S&P futures are headed for 1455 and support stands at 1431

QQQQ: The Q’s are headed for 47-48..

TLT - March Bonds: TLT is headed down into the 86-87 range. The bonds have resistance today at 111-12. Next downside target is 109-04. March 10 Year Notes: Resistance today is at 107-16. Next downside target is 106-08. The notes are headed for the 105-106 range.

Euro-US Dollar: The Euro has resistance at 130.70 and should soon resume its decline to under 116.

Dollar-Yen: The yen has reached temporary resistance at 121.70. Support is at 119.50. I expect to see the yen trade at 130 in 2007.

OIH - USO - March Crude: OIH has nearly reached resistance at 137 and should soon head down to 126 again. I think USO will rally to 47.00 before the bear market resumes. Crude should rally into the 56.00 to 57.00 range. Much lower prices are likely in the months ahead.

GLD - February Gold: GLD has reached strong resistance in the 64.00 - 65.00 zone and soon will start an extended drop. Gold has moved relentlessly higher, contrary to my expectation, but has reached its last top at 648. I think it will take a peek above that level but then start an extended drop to 600 and then continue lower.

March Silver: Resistance above the market is at 1330. I think a big drop in silver is underway and will carry the market below 900.

Tuesday, January 23, 2007

Here are hourly charts of the March S&P futures, the Spiders, and the QQQQ's. I last commented on these markets here.

I now think that I misinterpreted yesterday's market activity. In my last post on these markets I said that there had been follow-through selling subsequent to the wide range, down bar during the opening hour. But as you can none of these markets went much below the low of the first hour's range and the Spiders and the QQQQ's held the support level that I had been watching as my "drop dead" level, although the futures broke visibly below their corresponding level.

Morover, this morning in the S&P's and Spiders we have seen a wide range, up bar which has broken above the narrow trading range which followed yesterday's opening hour. All in all this is the picture of a market which exhausted itself on the downside during yesterday's opening hour. In other words, the buyers yesterday were in fact longer time frame traders. This has bullish implications.

I now think that the S&P's are headed up to the 1455 level and the Spiders to 144.40. The QQQQ's should rally into the 47-48 range.

Spiders - March S&P Futures: The S&P futures are headed for 1408 and resistance above the market is at 1435. The Spiders are headed for 140.00 and resistance today is at 142.80.

QQQQ: The Q’s are headed for 42.20 with resistance today at 44.30.

TLT - March Bonds: TLT is headed down into the 86-87 range. The bonds have resistance today at 111-12. The market is headed into the 109-110 zone.

March 10 Year Notes: Resistance today is at 107-16. The notes are headed for the 105-106 range.

Euro-US Dollar: The Euro broke above 130.00 resistance this morning but is likely to stop near 130.70 and then resume its decline to under 116.

Dollar-Yen: The yen has reached temporary resistance at 121.70. Support is at 119.50. I expect to see the yen trade at 130 in 2007.

OIH - USO - March Crude: OIH has rallied as high as 134 and still looks like it will get to 137 before resuming its decline. I think USO will rally to 47.50 before the bear market resumes. Support in crude is at 51.50 and a rally into the 56.00 to 57.00 range is underway. Much lower prices are likely in the months ahead.

GLD - February Gold: GLD is headed downward to 56.00. Gold should hold resistance at 641 and soon drop below 600 and then continue lower.

March Silver: Resistance above the market is at 1325. I think a big drop in silver is underway and will carry the market below 900.

Monday, January 22, 2007

Here are hourly charts for the March S&P futures, the Spiders, and the QQQQ's. I last commented on these markets this morning.

We have seen a modest amount of follow-through selling subsequent to the wide range, down bar this morning. This afternoon's rally has been weak and I still think the market is headed for the downside targets illustrated on the charts.

Once those targets are reached I expect to see a rally to new bull market highs.

The market has broken below what I thought would be support at 486. This means that GOOG is headed for the next lower support zone of 465-68. I still expect a move up to 564 over the next couple of months.

Here are hourly charts of the March S&P futures, the Spiders, and the QQQQ's. I last commented on these markets here.

Today's opening hour was a wide range down bar indicating aggressive selling by longer time frame traders. The key issue now is who were the buyers.

Normally, longer time frame sellers do not trade with longer time frame buyers. My best guess is that this is indeed the case here. The implication is that the market must move back to the lows of the current trading range to find more long time frame buyers. This means that the support levels I have drawn on these charts will be broken later today. The S&P's are headed down to 1408, the Spiders to 140.00 and the QQQQ's to 42.20.

If I turn out to be wrong in this assessment then these support levels will hold today and the market will start moving higher tomorrow. But at the moment I think this is the less likely outcome.

Spiders - March S&P Futures: Support today stands at 1431 in the S&P futures and at 142.40 in the Spiders. I am expecting an advance in the futures to 1455 and in the Spiders to 144.40 over the next couple of weeks.

QQQQ: Support is at 44.10 and the next upside target is 47.20.

TLT - March Bonds: TLT is headed down into the 86-87 range. The bonds have resistance today at 111-12. The market is headed into the 109-110 zone.

March 10 Year Notes: Resistance today is at 107-16. The notes are headed for the 105-106 range.

Euro-US Dollar: I think that a move to 116 and lower is underway. Short term support is at 128.50 and resistance above the market is at 130.00.

Dollar-Yen: The yen has reached temporary resistance at 121.70. Support is at 119.50. I expect to see the yen trade at 130 in 2007.

OIH - USO - March Crude: OIH should soon rally into the 133-135 range. I think USO will rally to 47.50 before the bear market resumes. Support in crude is at 51.50 and a rally into the 56.00 to 57.00 range is imminent. Much lower prices are likely in the months ahead.

GLD - February Gold: GLD is headed downward to 56.00. Gold should hold resistance at 641 and soon drop below 600 and then continue lower.

March Silver: Resistance above the market is at 1305. I think a big drop in silver is underway and will carry the market below 900.

Friday, January 19, 2007

Here are hourly charts of the March S&P futures, the Spiders, and the QQQQ's. I last commented on these markets here.

I still think the lows made yesterday in the S&P's and Spiders will hold. The bullish piece of evidence that attracts my attention is yesterday's wide range down bar after Bernanke's testimony. So far there has been no follow through selling and this tells me that longer time frame traders were buyers on that break. For this reason I am still expecting the S&P's to rally to 1455 and the Spiders to 144.40 over the next couple of weeks.

My "drop dead" level is illustrated in both charts by the dashed line which I have drawn at the levels of the last reaction low on the way up to the recent high. Weakness below the dashed line will mean that the market is headed back to its early January lows. Even then I would expect the early January lows to hold and would look for new bull market highs soon after.

The QQQQ's have been acting weaker than the S&P's after being stronger early in the year. The market has been trading around the 44.10 support level. I still expect a move up to 47.20 over the next couple of weeks.

Spiders - March S&P Futures: Support today stands at 1431 in the S&P futures and at 142.40 in the Spiders. I am expecting an advance in the futures to 1455 and in the Spiders to 144.40 over the next couple of weeks.

QQQQ: Support is at 44.10 and the next upside target is 47.20.

TLT - March Bonds: TLT is headed down into the 86-87 range. The bonds are getting close to short term support near 110-04. Resistance today is at 111-12. The market is headed into the 109-110 zone. March 10 Year Notes: The market is getting close to short term support at 106-20. Resistance today is at 107-16. The notes are headed for the 105-106 range.

Euro-US Dollar: I think that a move to 116 and lower is underway. Short term support is at 128.50 and resistance above the market is at 130.00.

Dollar-Yen: The market is headed for temporary resistance at 121.70. Support is at 119.00. I expect to see the yen trade at 130 in 2007.

OIH - USO - March Crude: OIH should soon rally into the 133-135 range. Support in USO stands at 43.50 and I think the market will rally to 47.50 before the bear market resumes. Switching to March contract in crude oil which trades about $1.30 over February. Support in crude is at 51.50 and a rally into the 56.00 to 57.00 range is imminent. Much lower prices are likely in the months ahead.

GLD - February Gold: GLD is headed downward to 56.00. Gold moved above short term resistance at 630 yesterday but I think it will soon drop below 600 and then continue lower.

March Silver: Resistance above the market is now at 1305. I think a big drop in silver is underway and will carry the market below 900.

Thursday, January 18, 2007

Here are hourly charts of the March S&P futures, the Spiders, and the QQQQ's. I last commented on these markets here.

As you can see from the charts above the S&P's and the Spiders both dropped a little below my estimated support levels but not so far below as to make me short term bearish. Morover, take a look at the wide range down bar highlighted in red. This occurred in reponse to Bernanke's congressional testimony. So far at least there has been no follow-through selling. My tentative conclusion is that longer time frame traders were buying on the break and this has bullish implications.

My best guess now is that the S&P's and Spiders will take a brief peek below this morning's low point and then start a rally to the upside targets of 1455 and 144.40 respectively.

The QQQQ's are in worse technical shape. The market has broken well below support and worse, the wide range down bar has seen some follow-through selling. Still, I think that support at 44.10 or so will hold and that the QQQQ's will soon move to new bull market highs.

Spiders - March S&P Futures: Support today again stands at 1435 in the S&P futures and at 142.70 in the Spiders. I am expecting an advance in the futures to 1455 and in the Spiders to 144.40 over the next couple of weeks.

QQQQ: Support is at 44.50 and the next upside target is 47.20.TLT - March Bonds: TLT is headed down into the 86-87 range. The bonds are getting close to short term support near 110-04. Resistance today is at 110-28. The market is headed into the 109-110 zone.

March 10 Year Notes: The market is getting close to short term support at 106-20. Resistance today is at 107-08. The notes are headed for the 105-106 range.

Euro-US Dollar: I think that a move to 116 and lower is underway. Short term support is at 128.50 and resistance above the market is at 130.00.

Dollar-Yen: The market is headed for temporary resistance at 121.70. Support is at 119.00. I expect to see the yen trade at 130 in 2007.OIH - USO - February Crude: OIH rallied to 131 yesterday and it looks like there is a little more to go on the upside, say the 133-135 range. Support in USO stands at 43.50 and I think the market will rally to 47.50 before the bear market resumes. Support in crude is at 51.00 and a rally into the 56.00 to 57.00 range is imminent. Much lower prices are likely in the months ahead.

GLD - February Gold: GLD is headed downward to 56.00. Gold moved above short term resistance at 630 yesterday but I think it will soon drop below 600 and then continue lower.

March Silver: Resistance above the market is now at 1305. I think a big drop in silver is underway and will carry the market below 900.

Wednesday, January 17, 2007

Here are hourly charts of the March S&P's, the Spiders, and the QQQQ's. I last commented on these markets here.

The S&P's and Spiders remain in the narrow trading range that began last Friday afternoon. I still think support in the S&P's is at 1435 although a drop into the 1433-34 range wouldn't really disturb the bullish picture. Similarly, the support in the Spiders is at 142.70 but a move as low as 142.50 wouldn't disturbe me. I am expecting both to breakout on the upside once these consolidations are complete.

The QQQQ's are now acting a bit worse than the S&P's after being the stronger market so far this year. I think they will hold support near 44.70 and then resume the rally to 47.20.

Spiders - March S&P Futures: Support today again stands at 1435 in the S&P futures and at 142.70 in the Spiders. I am expecting an advance in the futures to 1455 and in the Spiders to 144.40 over the next couple of weeks.

QQQQ: Support is at 44.80 and the next upside target is 47.20.

TLT - March Bonds: TLT is headed down into the 86-87 range. In the March bonds resistance today is at 111-08 while the short term downside target is 110-04. The market is headed into the 109-110 zone. March 10 Year Notes: Resistance today is at 107-12. Short term support is at 106-20. The notes are headed for the 105-106 range.

Euro-US Dollar: I think that a move to 116 and lower is underway. Short term support is at 128.50 and resistance above the market is at 130.20.Dollar-Yen: The market is headed for temporary resistance at 121.70. Support is at 119.00. I expect to see the yen trade at 130 in 2007. OIH - USO - February Crude: There is strong support in OIH at 126 or so and it should rally from there into the 131-32 range. Support in USO stands at 43.50 and I think the market will rally to 47.50 before the bear market resumes. Support in crude is at 51.00 and a rally into the 56.00 to 57.00 range is imminent. Much lower prices are likely in the months ahead.

GLD - February Gold: GLD is headed downward to 56.00. Gold has short term resistance at 630 and should soon be trading below 600.

March Silver: Resistance above the market is now at 1305. I think a big drop in silver is underway and will carry the market below 900.

Spiders - March S&P Futures: Support today stands at 1435 in the S&P futures and at 142.70 in the Spiders. I am expecting an advance in the futures to 1455 and in the Spiders to 144.40 over the next couple of weeks.

QQQQ: Support is at 44.80 and the next upside target is 47.20.

March Bonds: Resistance today is at 111-08 while the short term downside target is 110-04. The market is headed into the 109-110 zone.

March 10 Year Notes: Resistance today is at 107-12. Short term support is at 106-20. The notes are headed for the 105-106 range.

Euro-US Dollar: I think that a move to 116 and lower is underway. Short term support is at 128.50 and resistance above the market is at 130.20.

Dollar-Yen: The market is headed for temporary resistance at 121.70. Support is at 119.00. I expect to see the yen trade at 130 in 2007.

USO - February Crude: Support in USO stands at 43.50 and I think the market will rally to 47.50 before the bear market resumes. Support in crude is at 51.00 and a rally into the 56.00 to 57.00 range is imminent. Much lower prices are likely in the months ahead.

GLD - February Gold: GLD is headed downward to 56.00. Gold has short term resistance at 630 and should soon be trading below 600.

March Silver: Resistance above the market is now at 1305. I think a big drop in silver is underway and will carry the market below 900.

Friday, January 12, 2007

Here is a daily chart of NYMEX holdings which had its IPO in November 2006. This is my first comment on this stock.

The principal market of the NYMEX are energy and metals. Both these commodities I think are in for rough sailing over the next year and so it is no surprise that NMX is acting worse that the other "exchange" stocks. Morover, it has always been my view that the New York commodity exchanges were too firmly in the grip of their short sighted, floor trading members and consequently were slow to join the move to electronic trading.

For these reasons I think NMX can rally to 135 but I think it is in the middle of a bear swing which will eventually carry it below 100.

I think IBM will go a little higher than my current target of 99. My best guess is about the 106 level but if the bull really gets the bit between its teeth we may well see the 2 and 1/8 multiple of the 2002 low of 54.01 which stands at 115.

Spiders - March S&P Futures: Support today stands at 1426 in the S&P futures and at 141.70 in the Spiders. I am expecting an advance in the futures to 1455 and in the Spiders to 144.40 over the next couple of weeks.

QQQQ: The market is on its way to 44.70. Meantime support is at 43.50.

March Bonds: Short term support is at 110-04 and the market is headed into the 109-110 zone.

March 10 Year Notes: Short term support is at 106-20. The notes are headed for the 105-106 range.Euro-US Dollar: I think that a move to 116 and lower is underway. Short term support is at 128.50 and resistance above the market is at 130.20.

Dollar-Yen: The market is headed for temporary resistance at 121.70. Support is at 119.00. I expect to see the yen trade at 130 in 2007.

USO - February Crude: USO has dropped more than I expected but crude hit strong support yesterday at 52.50. I now think USO will rally to 47.50 before resuming its longer term drop. Crude should rally to 57.00 or so. Much lower prices are likely in the months ahead.

GLD - February Gold: GLD is headed downward to 56.00. Gold has begun a break which will carry it below 600 and eventually below 500.March Silver: Resistance above the market is at 1265. I think a big drop in silver is underway and will carry the market below 900.Google: A move up to 564 is underway. Support is at 485.

Thursday, January 11, 2007

Here is an hourly chart of the March S&P futures. I commented on this market this morning.

The S&P's have dropped a tad more than 6 points from today's high at 1435.75 and the Spiders have dropped about 60 cents. I think this reaction is complete and that the market will move to new highs for the day later today or move above today's high early tomorrow.

Follow me on Twitter

Twitter Updates

My Public Twitter Feed - Real time trade reports can be accessed through www.carlfutia.com

About Me

I write three financial blogs. The first is Carl Futia.On this blog I post daily "guestimates" of the current trends and trend potential in important markets. Once a week I post an explanation of my views on one of these markets with illustrative charts.
My second blog, Carl Futia Real Time, is subscription based. It is a real time trading seminar in which members receive my real time analysis of the E-mini S&P futures and can watch me trade them. In this seminar I explain how I calculate support and resistance levels and how I recognize market "rejections" of support or resistance which then determine the current trend directions.
My third blog is called The Art of Contrarian Trading and is based on my book of the same title. On that blog I focus less on day-to-day market details and more on swings in investor sentiment, the "information cascades" which I talk about in my book.